MV-PIAGGIO and the FUTURE

Already owning a F4S and spending a considerable time in italy
on a regular basis, the word is that the factory was in "casa
integrazione" ie all the workers at home collecting
unemployment from the government.
The original Piaggio deal fell through (Deutsch Bank did not
want to assume $150 million dollars of debt) however it seems
that a new, much smaller deal is in place.
Does anyone know what is going on?
Are they back working and making bikes?
Will I get my Brutale S ?

Answers

While we're on this subject, what is Cagvia's "bread and butter"?
Where are they making their money? Obviously, it's not all being made
in selling a few thousand F4s and Brutales a year. I see that they are
still making a nice adventure type bike, and the raptor stuff is
mildly interesting as well. But where do they really make their money?
Doesn't seem like there is much of it... The F4 is obviously their
flagship model, but it just doesn't seem to be doing too well right
now. Too bad, it's a wonderful bike.

I recently received an e-mail from a Cagiva Rep. He stated that
despite anything I may have heard, MV is still currently producing
motorcycles, and that they(Cagiva U.S.A.) continue to receive
anticipated shipments. He further informed me that they are
currently able to receive new products earlier then in previous
years. I can't guarantee this info, but this is what I was told.

Pontedera, Italy, July 24 (Bloomberg) -- Piaggio Holding SpA,
the maker of Vespa motor scooters, agreed to buy 20 percent of MV
Agusta SpA, helping the maker of Cagiva- and Husqvarna-badged
bikes to survive as the two companies discuss closer ties.
Piaggio has been discussing a buyout or merger with MV Agusta
for several months, according to Italian media reports. MV Agusta,
based in Varese, near Milan, has been struggling to pay suppliers
to continue production after spending too much on new production
facilities and on marketing new models.
``The agreement with MV Agusta,'' said Piaggio Chairman Dante
Razzano in a statement faxed to news organizations, represents
``the first step towards a possible closer integration between the
two companies.'' The companies didn't give financial details.
The European motorcycle market is suffering from flat sales
as insurance premiums rise and stiffer environmental protection
standards cause prices to rise. Moreover, governments in countries
such as Italy are insisting riders wear helmets, reducing the
attraction of scooters to riders accustomed to using their
machines bareheaded.
Shares of Ducati Motor Holding SpA, the maker of high-
performance motorcycles, have almost halved in value in the past
12 months. Ducati is Italy's only traded motorcycle maker.
``The motorcycle market is very competitive and has very high
marketing costs,'' said Carlo Cultrera, an analyst at Caboto in
Milan.
MV Agusta's flagship model is the 175 miles-per-hour, 750cc
F4, which costs about $20,000 and was part of the Guggenheim
Museum's ``The Art of the Motorcycle'' exhibition. The company's
Husqvarna-badged off-road bikes are leading contenders in that
type of competition.
Piaggio, the biggest European maker of two wheelers, is
controlled by Morgan Grenfell Private Equity Ltd., a unit of
Deutsche Bank AG. The buyout fund has been using Piaggio as the
center of a strategy to assemble brands to attain the size needed
to compete with Japanese rivals, such as Honda Motor Co., Ltd. and
Yamaha Motor Co., Ltd.
The company, which is based in Pontedera, near Pisa in
central Italy, in January agreed to buy Spain's Derbi Nacional
Motor SA for an undisclosed amount to boost market share in Europe
and widen its product range.
Last year Piaggio, which isn't publicly traded, had profit of
11.5 billion lire ($5.2 million) on sales of 2 trillion lire. MV
Agusta in 2000 sold 23,000 machines worth 240 billion lire.
Spokesman Martino Bianchi declined to discuss whether the company
was profitable or to supply further financial details.
MV Agusta would bring Piaggio a presence in both road and off-
road motorcycles, complementing its own range of scoters. Because
many dealers in Europe sell more than one brand of machine, the
ability to offer a full range of products is important, analysts
say.
While Piaggio has its Gilera motorcycle brand, the racing
success of MV Agusta's marques has brought them a higher profile.
MV Agusta's has won 37 constructors World Championships and 270
Grand Prix races. Husqvarna has won 64 constructors World
Championships.

--John Glover in the Milan newsroom (3902) 806-44-200, Story
illustration: http://www.mvagusta.com/index2.html for the
company's Web page. See {TNI ITALY TRN } for a menu of stories
about Italian transport. {TRNT } to see Top transport news.